HIGHLIGHTS-Bank of Canada's Carney speaks in Ottawa

Oct 30 (Reuters) - Below are key quotes from an appearance
by Bank of Canada Governor Mark Carney on Tuesday in Ottawa:

ON MONETARY POLICY AS LAST LINE OF DEFENSE

"The last line of defense is monetary policy. One doesn't
want to lead with monetary policy, but one doesn't want monetary
policy working at cross purposes, easing when everything else is
tightening, for example, when there is an economy-wide
vulnerability. Monetary policy can play a complementary role.
It's the last line of defense. And that's why we work closely
with other authorities to ensure that all potential mechanisms
and tools can be used to greatest effect."

ON MEASURES TO CURB HOUSEHOLD DEBT:

"The growth rate of household spending has in fact slowed
and second of all ... the government has taken a number of
steps, four series of measures to try and tighten up the rules,
the CMHC rules, regarding mortgage insurance. But I think we
have to remain vigilant and there are a number of options,
regulatory options. But the most recent changes have just been
introduced and we're starting to see the effects of those
changes now. From our standpoint, now is the time to observe
what is going on, to see what the impact of those measures is at
this point."

ON TIGHTER MORTGAGE RULES:

"These measures as a whole are contributing to  a more
sustainable development of the housing market here in Canada and
we welcome those and we welcome also the measures that OSFI
(Office of the Superintendent of Financial Institutions) has
taken to improve mortgage underwriting standards of financial
institutions."
Continued...